Donna Young, a homeschool teacher, has an excellent website - YoungMinds Handwriting.  She discusses techniques and provides printable practice worksheets.  At the kindergarten level, kids first practice making the straight lines, curves, arches and circles that are parts of the letters.

http://donnayoung.org/penmanship/

As with all practice at that age, keep the writing sessions short - 5 to 7 minutes.  After practicing the parts, teach capital letters first because they're easier, then lower case.

You demonstrate, they imitate. Kat's ABC computer game can be used for demonstration if you have a whiteboard or computers for kids to use:

http://www.abclearningtime.com/myabcs.htm

Then provide them a model (practice sheet with letter) and they copy the model.  Then you ask them to practice making the letter without the model.  

To make it fun, I sometimes ask them to have a beauty contest and circle the letter on their page that they think they made the best - the most beautiful or handsome.

From a developmental standpoint, letters are more easily learned by introducing the "lined letters", the "circular or half circle letters, and last the diagonals.  Diagonal perception does not come in developmentally until between 4 1/2 years to five years of age.  Therefore, many kindergarten students still struggle with perfect diagonals in letters such as A, N, M, etc.
It is wise to remember that we have better muscle memory in our larger muscles and joints.  Therefore, teach a letter using very large movements at an easel or chalkboard.  Once a child is able to write it large and then with his eyes closed, move to paper.  He then just has to coordinate his fingers to write as he already knows the letter through his motor memory and has a visual picture (eyes closed) of the letter.  A fun game to play is both you and your child should stand at the easel or chalkboard.  Ask him to move your hand (with the chalk or marker) to write a letter on the easel while your eyes are closed. You must guess the letter with your eyes closed.  (Its helpful to make a mistake sometimes). Then ask him to close his eyes and you move his hand (which is holding the chalk or marker) through making a letter.  See if he can guess the letter while not looking.  Its helpful to begin with the letters in his name until he is comfortable with the game.  Always assure success  so he will want to play again.

I just wanted to update the link to website resources available to help kids with block and cursive handwriting.  These sites provide printable worksheets - many of them customizable - along with tips and advice for parents and teachers guiding children in this skill:

http://www.learningreviews.com/jreviews/Handwriting.html

The LearningReviews.com link listed in my first post is no longer working.  The site's directory has been reorganized.